Correlation Between Intel and ARB
Can any of the company-specific risk be diversified away by investing in both Intel and ARB at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Intel and ARB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and ARB Limited, you can compare the effects of market volatilities on Intel and ARB and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Intel with a short position of ARB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and ARB.
Diversification Opportunities for Intel and ARB
Excellent diversification
The 3 months correlation between Intel and ARB is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Intel and ARB Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ARB Limited and Intel is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Intel are associated (or correlated) with ARB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ARB Limited has no effect on the direction of Intel i.e., Intel and ARB go up and down completely randomly.
Pair Corralation between Intel and ARB
Given the investment horizon of 90 days Intel is expected to under-perform the ARB. In addition to that, Intel is 2.98 times more volatile than ARB Limited. It trades about -0.05 of its total potential returns per unit of risk. ARB Limited is currently generating about 0.1 per unit of volatility. If you would invest 2,034 in ARB Limited on September 3, 2024 and sell it today you would earn a total of 458.00 from holding ARB Limited or generate 22.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 83.0% |
| Values | Daily Returns |
Intel vs. ARB Limited
Performance |
| Timeline |
| Intel |
| ARB Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Intel and ARB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and ARB
The main advantage of trading using opposite Intel and ARB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, ARB can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in ARB will offset losses from the drop in ARB's long position.| Intel vs. NVIDIA | Intel vs. Taiwan Semiconductor Manufacturing | Intel vs. Marvell Technology Group | Intel vs. Micron Technology |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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